Ministers halve guideline rent increase

Council tenants are to benefit from a lower than expected rent increase after Ministers changed the guidance issued to local authorities in light of falling inflation levels.

Housing Minister Margaret Beckett has announced that the average guideline increase of 6.2 per cent is to be reduced to 3.1 per cent. Beckett says the Government will make funding available to meet any shortfalls in revenue as a result of the cut.

According to the Department of Communities and Local Government, the changes means tenants should see their proposed average rent increase fall from around £4 per week to just under £2.

Speaking in Friday Mrs Beckett said: “We are facing challenging economic times and it is right that this Government offers real help now to council tenants. We have listened to what councils and their tenants have said to us about the planned rent increases, and we are determined to help tenants get a fair and affordable deal.”

“Ultimately, it is for each council to take up this offer of support, but I would expect them to ensure their tenants receive the full benefits.”

The announcement has been welcomed by council leaders across London, including by Newham’s elected Mayor Sir Robin Wales.

Sir Robin said: “I applaud the government for the way it has listened to our concerns. I’m pleased councils have had their voices heard and that housing minister Margaret Beckett has taken exceptional action to help council tenants this year.”

Beckett has already undertaken to look again at rent guidance for 2010-11.

The news follows publication of figures showing London’s 33 local authorities have delivered an average Council Tax rise of 1.2 percent, less than half the national figure.